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SERA Plus Changes
SERA is committed to providing exceptional value to its members by delivering quality financial products and services to our members through our SERA Plus program. Consistent with our philosophy, we are pleased to announce that financial planning, investment, insurance (including auto, home and liability), tax planning, estate planning advice, and banking services will soon be offered exclusively through our new relationship with Hantz Group, Inc., and its affiliates (together, “Hantz”), headquartered at 26200 American Drive, Southfield, Michigan 48034.
Our decision to offer financial planning, investment, insurance, tax planning, estate planning advice, and banking services through Hantz allows us to provide you with a variety of financial services under one roof. Hantz Group, along with its affiliates, Hantz Tax & Business, LLC, Hantz Agency LLC and Hantz Bank, to name a few, provides a comprehensive approach to your specific financial service and banking needs. Hantz will offer and provide its services through its 21 locations conveniently located near most of our chapters throughout Michigan.
For more information on Hantz, including locations, please visit www.hantzgroup.com or contact our SERA Plus program administrator, Cheryl Streberger at 517-515-9815.
Class Action Against State of Michigan: Taxation of State Pensions (Okrie vs State of Michigan)
Supreme Court Says No To Court of Claims Suit
The Michigan Supreme Court opted today not to take up a suit challenging the constitutionality of the new Court of Claims structure.
Using its standard wording, the court ruled it was “not persuaded that the questions presented should be reviewed by this court.”
The state Court of Appeals ruled last August in Thomas Okrie v Michigan that the Legislature has the ability to pull claims against the state of Michigan from the Ingham County Circuit Court to a pool of four appellate judges (See “COA Rules New Court Of Claims Structure Is Not Unconstitutional,” 8/20/14).
At the time, Okrie went after the new structure from various angles, but Judges Jane Beckering, Joel Hoekstra and Karen Fort Hood wrote the suit does not meet the “heavy burden to show” the law is unconstitutional.
Legislative Democrats and Ingham County judges objected in 2013 when the Republican-led Legislature swiftly passed the bill moving the Court of Claims out of Ingham County to the appellate court. The new system arguably created a court more accessible to the people, since the Court of Appeals have four locations across the state.
But Democrats and Okrie, a former public school teacher who retired from the Troy School District in 2000, argued the move stunk of politics.
The new law creates a system where one Court of Appeals judge hears cases at the trial court level and then a panel of that judge's colleagues on the Court of Appeals reviews the decisions on review.
Obviously, judges who hear the initial case can not take part in the appeal and the court will “maintain the highest ethical standards” when reviewing Court of Claims cases initially decided by their colleagues.
Supreme Court Lets Stand Ruling Affirming Change In Court Of Claims
The Supreme Court in a brief order released Wednesday declined to hear the appeal of the plaintiff who had accused Governor Rick Snyder and the Legislature of violating the Constitution when they moved the Court of Claims out of the Ingham Circuit Court and into the Court of Appeals.
In the case, (Okrie v. State of Michigan, SC Docket No. 150111), Thomas Okrie sought to overturn the Court of Appeals' rejection of his lawsuit. The Supreme Court, as is usually the case when it declines to grant leave to appeal, said only that it was not persuaded the case should be heard.
Michigan SERA Council Chair Bob Kopasz and I attended the oral argument in these cases. The make-up of the court makes me think the employer will likely win.
Supreme Court Tackles State Employee RTW, Pension Cases
Gongwer 1-13-15 The Supreme Court was essentially asked to rule that unions, or at least collective bargaining, are a condition of employment, but pensions are not in two key state employment cases argued Tuesday. In deciding what is a condition of employment for state civil service workers, the court could also be determining the limits of authority for the Civil Service Commission.
Union attorneys urged the court to overturn the Court of Appeals ruling (International Union v. Green, SC docket No. 147700) that the new right-to-work law applies to state employees, but to uphold the appellate court’s finding (Michigan Coalition of State Employee Unions v. Michigan, SC docket No. 147758) that only the commission can approve the 4 percent surcharge the Legislature added to cover retirement health care costs.
Most of the questioning came from Republican members of the bench, and often they appeared unsatisfied with both sides’ definition of conditions of employment. William Wertheimer, attorney for the state employee unions in both cases, said the Court of Appeals crossed a long-established line in finding right-to-work applied to state employees. “The commission alone regulates conditions of employment for classified employees,” he said. “The Legislature’s not allowed to meddle with classified employment.” Unions, he said, are not conditions of employment. But collective bargaining is, making the agency fees the unions charge legitimate. “The issue is a fee which the parties negotiated,” Mr. Wertheimer said. “It pays for collective bargaining that the commission has decided is an appropriate way to deal with the employee-employer relationship.”
But justices questioned whether the commission had the sole authority to make that decision. Justice Stephen Markman noted that the Constitution provides the commission the authority to regulate conditions of employment. “Perhaps the term ’regulate’ should be given its ordinary meaning ... Something distinctive from legislative,” he said. “The Legislature has the distinctive authority relative to hours and conditions.”
But Chief Justice Robert Young Jr. questioned what collective bargaining is if it is, as Assistant Solicitor General Ann Sherman argued, not a condition of employment.
Ms. Sherman agreed with Justice Mary Beth Kelly that it is a process of negotiating conditions of employment. “It’s a relationship with a third party that to some extent impacts many areas of employment, but is not itself a condition of employment,” Ms. Sherman said of collective bargaining. Ms. Sherman said mandatory union dues or agency fees also run afoul of the Constitution’s plan for paying for state employment oversight: the 1 percent of payroll provided to the commission. “The
The people appear to have intended that the 1 percent wouldn’t be passed on to the (employees),” she said. “Who pays for it is important ... Because the 1 percent is in the Constitution.” She said the bargaining process is also outside the bounds of the Constitution because the commission essentially delegates that to the Office of the State Employer in the Executive Office rather than conducting those talks itself. “Collective bargaining is not consistent with the whole idea of a civil service commission,” Ms. Sherman said, adding that collective bargaining was not considered when the provisions regarding the commission were added to the Constitution. If the drafters of the Constitution had wanted to include collective bargaining, “they could have said all conditions of employment and all mechanisms leading to those conditions,” Ms. Sherman said. “And that would have been more clear?" Mr. Markman said.
John Bursch, former solicitor general in this case representing the Michigan Chamber of Commerce, said the Constitution provided a hierarchy of powers. “The Legislature has authority to enact laws,” he said. “The commission has the lesser power to regulate.” If the commission had the authority to exempt itself from the right-to-work law, Mr. Bursch said, what would stop it from ignoring other laws like the Elliott-Larsen Civil Rights Act or child labor laws. “The people drafting the Constitution knew how to exempt the Civil Service Commission from legislative authority if they wanted to,” he said.
Though the role of appellant and appellee switched, state and union attorneys made essentially the same arguments on the retiree health care charge. Pension benefits are not a condition of employment, Assistant Attorney General Pat Fitzgerald said, because they were created by the Legislature. And the commission essentially conceded it had no role. “If that were the case (that the commission has exclusive authority), then the Civil Service Commission has been missing in action for the last 70 years while the Legislature illegally acted,” Mr. Fitzgerald said. He noted that, while constitutional provisions on the commission do not mention pension benefits, provisions regarding State Police troopers do, so arguably pension benefits were not meant to be considered in the former.
Mr. Young and Mr. Markman both noted that the Constitution provides the Legislature with veto power over pay increases, but not over pension benefit changes.
Mr. Wertheimer countered that the commission, not the Legislature, came up with the idea of a pension. “Before it was enacted by the Legislature, the commission was retiring people on its own,” he said. “The commission has been involved in the pension fund from the beginning.” And he said there was some thought that the Legislature has the authority to veto pension changes. He noted the Legislature’s attempt to overturn providing health care benefits to same sex couples.
Mr. Young countered that, since the Legislature failed in that attempt, its use of that power had not been tested in the courts. Mr. Wertheimer said pension benefits are also clearly a condition of employment. “If I’m an employee, whether or not I have a pension and I have to pay for it, that’s compensation and a condition of employment,” he said. Mr. Young questioned why, then, the commission was merely an amicus to the case and not a party. “You indicated they didn’t have power more than any citizen has: to petition the Legislature for relief,” Mr. Young said.
Ms. Kelly questioned what authority the commission would have to overturn the legislative change. “Once you want the form of a pension that’s inconsistent with what the Legislature proposes and funds, the CSC doesn’t have the resources to fund their proposal,” she said.
Mr. Wertheimer said the commission would have to do what the unions have done: challenge the legislation in court.
See the briefs on International Union v Green (right to work case)
About Michigan SERA
SERA is an non-profit organization devoted exclusively to issues and concerns of all current and future retirees of the State of Michigan.
SERA works to:
SERA works through its members, leaders, and committees to promote the best interests of state employee retirees and future retirees. At least eight times since 1974, SERA was a moving force in pension increases or benefit improvements. In 2011, we opposed the pension tax and helped eliminate it for 70% of retirees; we opposed the remaining tax on public pensions for those born after 1945 in the Michigan Supreme Court. We opposed the recent state employee retirement system changes. That work continues.
SERA has 21 local chapters statewide that are linked through the Coordinating Council of the State Employee Retirees Associations of Michigan (the SERA Coordinating Council). SERA chapters have periodic meetings with guest speakers, opportunities for networking, newsletters, and other activities.
SERA welcomes the new ideas and energy of new members! To join, contact Cheryl Streberger at 517-515-9815 or email@example.com.